Extensive research has been undertaken on the issue of SOEs in recent years, in particular by OECD, IMF and the European Commission. This previous body of research focuses both on issues of governance (general corporate governance and specific challenges for SOEs) and performance, mostly correlated with governance to demonstrate that improvements in governance are accompanied by an equivalent improvement in performance. However, the current definitions of “performance” are not altogether satisfactory or systematic, as they do not properly account for the particularities of SOEs. This policy brief challenges the current view of “performance” for SOEs for benchmarking purposes and proposes an alternative research method for performance based on a proper definition of the term in the particular case of SOEs. Indeed, as will be shown below, we also find that good governance leads to better performance – but more importantly, the correlation is more visible when performance is appropriately defined.